PH foreign debt rises to $98.5B in 2020

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Metro Manila (CNN Philippines, March 20) — The country's outstanding foreign debt soared to $98.5 billion in 2020 as authorities sought to boost the war chest against the COVID-19, the Bangko Sentral ng Pilipinas said Friday.

The central bank said external debt ballooned by $14.9 billion as of end-2020 from $83.62 billion a year earlier, 7.1% or $6.5 billion of which was obtained in the fourth quarter.

The BSP said external debt refers to borrowings by residents from nonresidents.

Data showed public sector external debt jumped to $58.1 billion in the last quarter from $54.4 billion as of end-September.

Majority or 89% of the figure were loans of the national government amounting to $51.9 billion, while $6.3 billion were borrowed by government-owned and -controlled corporations, government financial institutions, and the BSP.

BSP Governor Benjamin Diokno said the national government raised $2.8 billion from the issuance of global bonds and $733 million net availments from official sources in the last three months in a bid to increase its COVID-19 funding and to finance infrastructure projects.

Borrowings of the private sector also picked up to $40.4 billion as of end-December against the $37.6 billion recorded in the first nine months. The central bank said the increase was due to net availments of private banks and private non-banks.

Despite this, the BSP chief said key external debt indicators "remained at prudent levels" with gross international reserves settling at $110.1 billion in 2020, which could cover short-term debt by 7.8 times.

Major creditor countries were Japan ($15.0 billion), the US ($3.4 billion), the United Kingdom ($3.3 billion, and Netherlands ($3 billion).

The country's debt stock was largely denominated in US dollar at 56.7% and Japanese Yen at 11.8%.

The central bank also noted that borrowings in the form of bonds or notes had the largest share at 35.6 percent of total outstanding debt.